Introduction
Today’s energy storage technologies can be categorized into mechanical, electrochemical, and electrical. Some well-known storage technologies include pumped hydro storage, flywheel, lithium ion batteries, lead acid batteries, and flow batteries. Different technologies vary in their power capacity and the length of time they are able to discharge energy, and each technology can be better suited for certain purposes. For example, pump hydro storage offers bulk energy management with hours of discharge time but has geographical limits and is capital intensive. Lead acid batteries, on the other hand, are relatively inexpensive but have low energy and power density in addition to environmental concerns.
Batteries, one subset of storage technologies, are an exciting technology that promises to revolutionize how we manage and provide power. However, as exciting as they may seem, they are hardly new. This technology in one form or another has been around since 1799 when Alessandro Volta created the first battery. However, it’s been only in the last few years as laptops, smart phones, and electric vehicles have pushed us beyond lead-acid batteries to lithium-ion and other, more-exotic technologies. This move has unlocked a variety of new capabilities, ushering in dramatic performance gains and falling costs. Now, many pundits predict it’s only a matter of time before battery storage becomes a ubiquitous part of our grid, our homes, and businesses everywhere.
Battery Storage Overview
Unfortunately, batteries are not one giant Duracell™. In fact, an
Energy Storage System (ESS) has three distinct components: energy storage (e.g. the battery - the chemical conversion system to store and release energy), the power conversion system (PCS), and the balance-of-system (BOS) essential to maintaining the health and safety of the entire ESS. Because energy storage is inherently a chemical process, ESS is often referred to by the chemistry mechanism utilized, such as lithium ion, lead-acid, redox flow, and zinc-hybrid. Regardless of the mechanism, energy is stored in direct current (DC) form and converted by the PCS to alternating current (AC) for delivery to the gird or customer. Similarly, the PCS converts AC power from the grid to DC to charge the ESS. Typical BOS components include the battery enclosure,
battery management system (BMS) to monitor the health of the ESS and control how the energy storage is utilized, safety equipment, switchgear, hardware to connect to the grid or customer load, and metering / instrumentation to monitor performance.
"Batteries, one subset of storage technologies, are an exciting technology that promises to revolutionize how we manage and provide power"
An ESS can support a variety of applications, including energy, power, or ancillary services. Energy-oriented applications focus on long duration operation such as energy price arbitrage, wind and solar integration, grid investment deferral, congestion relief, and asset optimization. Power-oriented applications rely on short bursts of energy to balance the grid and quality of power. These applications are usually more power intensive over shorter operation periods. Applications include load following, solar smoothing, power quality, and reliability enhancement. Ancillary services applications include frequency regulation, spinning and non-spinning reserves, black-start, voltage regulation, and demand response. ESS can come in both large, grid-connected (e.g. utility-scale, ranging from 1MWh to larger than 100MWh) and small, customer-connected (e.g. customer-scale, less than 1MWh in size and connected either in front of the customer meter or behind the meter) forms.
Technical Development Needed to Fully Utilize ESS
Thanks to ESS, new capabilities can now be realized. ESS has unlocked new value to enhance the grid and lower the cost to serve customer. But to make it happen, utilities need distributed grid-edge control systems, enhanced analytics, and interoperability of utility- and customer-owned assets to maximize these opportunities. Traditional centralized grid management has difficulty in keeping up the amount of data and complexity brought on by ESS and distributed energy resources (DER’s – solar, wind, etc.,.).Many of today’s utility control systems operate centrally with periodic polling for utility asset data – sometimes taking as long as 15 minutes between scans – hampering timely control and creating instability in the grid. DER performance can shift dramatically within seconds, necessitating a different approach to control and optimization. Distributed grid-edge control systems and new, streaming analytics tools to enhance centralized management systems can overcome slow traditional response times and the limitations inherent in autonomous inverter control that lack the ability to provide global grid benefits. Ultimately, interoperability and distributed computing will enable better resiliency, security, holistic grid awareness, and optimal energy dispatch solutions.
Economic and Regulatory Opportunities from ESS
Recognizing the potential benefits from ESS, many Independent System Operators (ISO’s), states, and our Federal government are trying to update the regulations that govern ESS. In fact, the Federal Energy Regulatory Commission (FERC) issued Order 841 in February 2018, requiring grid operators to structure market rules so that ESS can participate in wholesale markets. These developments signal a shift from experimentation to operationalization of ESS. Similarly, cost declines and performance improvements driven by scaled production and technology maturation have been so rapid that what was technically and economically infeasible only a few years ago is now mainstream. This fast maturation has caught many by surprise, and companies that move quickly to adopt these capabilities will help shape the market and drive new capabilities. Additionally, creative financing and innovative offer structures will lead to breakthroughs in adoption that were inconceivable only last year. Historic regulatory models will need to catch up in order to enable the creation of new customer and utility capabilities.
Conclusion
ESS encapsulates bold, new capabilities that can further enable customer adoption of new technologies, enhance grid resiliency and reliability, and transform traditional energy economics. While there are several technical and regulatory headwinds to their adoption, ESS performance gains and cost declines continue to win over critics. Over the next decade we should expect to see ESS become a more ubiquitous part of the grid and in customer homes and businesses. Utilities, regulators, and customers are still awakening to the potential benefits, costs, and challenges from ESS, but the future seems bright for this exciting technology.
